As the online channel becomes more pervasive, carving your slice of market share has never been more important.
As the online channel becomes more pervasive, the fight for relevance is ever more important for brokers.
With international giant Blockbuster recently announcing the closure of its US stores due to online streaming, social commentator and author Michael McQueen gives some timely advice on keeping one step ahead in a rapidly changing environment, and stopping your business from following Blockbuster's example.
- Change before you are forced to
Most businesses wait to innovate until their hand is forced. As Steve Jobs once observed, if you’re not willing to cannibalise your own business, someone will do it for you. Consider how Blackberry and Nokia have done just this in recent years. Rather than recognising the seismic shifts afoot in their industries, both these tech giants essentially relied on this historical size and market positioning until the writing on the wall was too dire to ignore. In contrast, look at how Encyclopaedia Britannica started preparing for the post-print age as far back as the mid 1990s and therefore had shifted entirely away from their reliance on paper-based products by the late 2000s.
- Become clear on the business you are actually in
Many businesses fall into the trap of defining themselves by the products they sell or the markets they are operating in - all the while losing sight of who they are and why they exist. Consider how Kodak did this and veered off track in the 1970s and 80s. Rather that remaining focussed on their core DNA as a memory preservation company, Kodak started to see themselves as a film company - a paradigm that left them unwilling and unable to embrace the post-film world.
- Prune dead wood
Any gardener knows that restoring vitality to a garden required pruning away the old in order to make way for the new. It is the same in business. Consider how global scientific company DuPont have consistently stayed ahead of the curve by being willing to prune away even their most successful past cash cows such as Nylon, Lycra and Teflon. Sony have also recognised the importance of this in turning around their flagging fortunes. The end of their decade-long marriage with Ericsson and the spinning off of entire business units is an attempt to restore the tech giant’s agility and innovative flair.
- Question everything
The moment any business or leader thinks they have made it, they have passed it. Never fall into the trap of feeling that you are too big to fail or that what has worked in the past will work in the future. Question everything and spare no sacred cows. Consider how IBM did this in the early 1990s and saw one of the most dramatic turnarounds in recent corporate history.
- Re-engineer outdated systems and processes
There is a big difference between being in a groove and being in a rut. Many businesses need to honestly evaluate their internal systems and processes. Which of them is outdated, inefficient or simply the 'way things have always been done around here'? Harley Davidson realised the importance of this in 2009 amidst a severe sales slump and set about re-engineering their internal systems. This exercise saved them $275 million in annual running costs and resulted in the business regaining its nimble responsiveness.
- Beware biting off more than you can chew
While adopting new products and services is a key way of regaining relevance in a flagging business, beware of trying to change too much too quickly. Consider how Billabong fell into this trap in the late 2000s by acquiring a long list of other brands in the marketplace - a fateful step which has played a key role in them losing focus.
- Become ruthlessly customer-centric
It is critical you stay focussed on how the needs, desires and preferences of consumers are changing. Your strategy can never be a 'set and forget' one. Geoff Bezos has a novel way of doing this at Amazon. At every board meeting he leaves an empty chair which represents Amazon's customer. No decision is made without the active consideration of how it will impact on the person in that empty chair.
- Look to 'imovate'
The term coined by leading business thinker Oded Shenkar highlight the values of innovating through imitation. He suggests that others may be doing things you can learn from. What practices and ideas are competitors using that could you incorporate and do differently or better? Consider how Lego did this in embracing video games; Samsung did this in the development of their smartphone range; and how even Apple did this by not inventing the MP3 player but rather making it sexy.
- Encourage dissension within the team/organisation
The most valuable source of innovation in any time is the individual who has fresh eyes or a dissenting view. Are you allowing and encouraging those views to be heard? Ikea did and the whole basis of their flat-pack business model came as a result.
- Seek a point of difference
The old marketing adage is true... it is better to be different than better. Rather than trying to outdo the competition in your market, how can you pursue a new market in a new way? Consider how Cirque du Soleil did just this and managed to build a flourishing business in a dying industry (circuses).
Related:
Death of the middleman: Staying relevant in an online world
What brokers can learn from the fallen
What do you think brokers need to do to stay relevant in today's market? Share your thoughts below.
